Menzgold Ghana Limited has been asked to suspend its gold trading operations with the public by the Securities and Exchange Commission (SEC).
According to the SEC, Menzgold has been dealing in the purchase and deposit of gold collectibles from the public and issuing contracts with guaranteed returns with clients, without a valid license from the Commission.
This, the SEC says, is in contravention of “section 109 of Act 929 with consequences under section 2016 (I) of the same Act.”
The company has however been cleared to continue its “other businesses of assaying, purchasing gold from small-scale miners and export of gold.”
The SEC said in its statement, dated September 7, that it has been investigating Menzgold since 2017 but paid a working visit to the company on August 23, 2018 where they met with the Commercial Manager, Nana Yaw Offei and an adviser to the company’s CEO, Derek Akubia.
SEC stated that despite being licensed to only purchase and export gold from licensed sellers, Menzgold also sells and purchases gold collectibles from the general public through its agent, Brew Marketing.
The Commission has since requested for “detailed information” on the activities of the company which the lawyers of Menzgold have agreed to provide within 14 days.
The SEC, however, believes that this notwithstanding, the company’s activities constitute an illegality and are “a threat to unsuspecting and uninformed investors.”
The statement from the SEC added that failure by Menzgold to comply with the directive “will lead to the SEC employing other relevant measures under the law to enforce compliance.”
The Commission also called on the Minerals Commission which licensed the operations of the gold trading company to “call Menzgold to order and direct it to conduct its business in accordance with the license issued to it by MINCOM”